Israel Plans to Make Pound Freely Convertible into Foreign Currency

The Israel Treasury is considering steps to make the Israeli pound freely convertible into other currencies, it was announced here today by Zvi Dinstein, Controller of Foreign Exchange.

Dr. Dinstein reported to a press conference here that Israel’s foreign currency revenue increased by 14 percent last year to a record high of more than $1, 000, 000, 000. At the same time, he noted, expenditures increased by less than two percent to a total of $879, 000, 000.

A stabilization of living costs in Israel was indicated this week in the announcement that the cost-of-living index for June dropped 1.1 points to stand at 127.9. As a result of the June drop, the average index standing for the past six months is about 0.3 percent less than the three percent required to increase the cost-of-living allowance paid to all wage-earners in Israel, The allowance is fixed each six months on the basis of fluctuations in the cost-of-living index.

A survey by the Bank of Israel of the country’s economy for the first five months of the year found that prices had remained stable in most consumer commodities despite a continuing increase in personal purchasing power. This increase was attributed mainly to continued receipt of German restitution funds from abroad and income from increased exports.

The survey, however, noted a 30 percent increase in the value of securities in the first four months of the year, a marked growth in real estate speculation and a sharp increase in real estate prices.